Convention centre continues record-breaking streak | Fin24

Convention centre continues record-breaking streak

Oct 25 2016 15:58
Carin Smith

Cape Town - The Cape Town International Convention Centre (CTICC) achieved another record breaking financial year, CEO Julie-May Ellingson said at the annual general meeting results presentation on Tuesday.

The City of Cape Town is the majority shareholder (67.8%) of the CTICC, while the Western Cape Government owns a 25.3% stake and SunWest International 6.9%. According to Andrew Boraine, chair of the Cape Town International Convention Centre Company (Convenco), the holding company of the CTICC, the centre is a strategic asset economic asset.

"It is very important to deliver on the triple bottom line so that the CTICC is not a burden on taxpayers. At the same time it must deliver excellent experiences," said Boraine.

The CTICC managed to obtain the best results in its 13-year history, breaking through the R200m revenue ceiling during the financial year ending June 30 2016. Revenue increased by R12m to R209m and profit after tax increased from R42m to R47m. Earnings before interest, tax, depreciation and amortisation increased from R52m to R57m.

During the financial year CTICC hosted 504 events, including 39 international conferences, 28 national conferences, 15 exhibitions, 19 trade fairs, 28 banquets, 37 special events and 338 film shoots and other events.

Ellingson cautioned that, despite the 2015 and 2016 financial years showed record breaking results, continued investment in its business must be non-negotiable. She added that the CTICC managed to produce its good results despite uncertain macro-economic conditions. For example, a further R351m has been invested by CTICC and its shareholders in expansion of its facilities. This will effectively double the CTICC exhibition space and increase Cape Town's global competitiveness as a meetings and events destination.

READ: CTICC earns Top500 award

The CTICC East expansion has already secured several high profile events, the first of which will take place in September 2017. The CTICC, the City of Cape Town and the Western Cape Government are investing a total of R832m in the project.

Strict budgetary controls added to the overall 2016 results achievement as R17m was saved across all cost categories.

It is estimated that the CTICC added R3.5bn to the national economy during the 2016 financial year and R3bn to the Western Cape economy. The total cumulative contribution of the CTICC to the national gross domestic product (GDP) and the provincial gross geographic product (GGP) since it opened its doors in 2003 is estimated at R32.5bn and R28.8bn respectively.

Ellingson emphasised that, apart from the employment opportunities created by CTICC activities and operations, a contribution is also made to the growth of small, medium and micro enterprises (SMMEs) and black economic empowerment. For example, R522.4m (92.8%) of CTICC's spend was with B-BBEE suppliers - 6% more than the previous financial year.

Procurement from SMMEs amounted to R166m (70.9%) of total procurement spend - although excluding procurement for the CTICC East expansion project. Procurement from women-owned companies increased to 30% in 2016.

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